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Dairy Industry in India Fostered by Booming Food Sector

The dairy industry in India has witnessed a strong growth over the past few years. Some of the major driving factors include rising purchasing power of consumers, thriving food sector, a strong demand for ready-to-eat dairy products and the improving distribution network.

IMARC Group’s latest report, titled “Dairy Industry in India 2017 Edition: Market Size, Growth, Prices, Segments, Cooperatives, Private Dairies, Procurement and Distribution”, finds that the dairy industry in India reached a value of nearly INR 7,000 Billion in 2016, growing at a CAGR of 13% during 2010-2016. Dairy products form an integral part of the daily diet across all income groups in India. Milk, ghee, curd, paneer and cheese are extensively used to prepare a number of dishes in Indian households, which include appetizers, sweets, beverages and desserts. Dairy products are also being introduced in western food products in order to customize them as per Indian tastes; paneer is now being added to pizzas, burgers, tacos and several other western food products in India.

Highlights of the Dairy Industry in India:

Dairy products, such as curd, butter and ghee, are an integral part of the Indian diet.

The flourishing food industry and rising standard of living represent the primary growth driving factors.

On the basis of product type, market is segmented into milk and value-added products.

One of the major growth-inducing factors of the Indian dairy industry is the sustained growth of the economy, which is resulting in a rise in the disposable incomes and the standard of living of consumers. As the demand for dairy products is income elastic, a continuous rise in the disposable incomes is creating a positive impact on the market growth. Further, the flourishing food industry in India plays an important role in the growth of the dairy market. An increase in the consumption of bakery products and dairy-based beverages has propelled the growth of the market. Apart from this, increasing urbanization rate coupled with hectic lifestyle of consumers has also contributed to the demand for ready-to-eat dairy products in the country, the most preferred being buttermilk, yogurt, flavoured milk and cold coffee. Some of the other factors stimulating the market include improving distribution network, changing dietary patterns of consumers, and aggressive marketing and introduction of new dairy products by manufacturers. According to the report, the market is further expected to reach a value of more than INR 16,000 Billion by 2022.

The market has been segmented into two categories, organised and unorganised market. On the basis of product type, the market has been segmented into milk and value-added dairy products. Based on competitive landscape, the key players in the market are GCMMF (Amul), KMF, Mother Dairy, TN Cooperative, Saras and Hatsun Agro Product Ltd.

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